EU and US agree to end Airbus/Boeing conflict

The European Union and the United States on Tuesday announced a five-year truce intended to settle the old conflict between Airbus and Boeing which is poisoning their relationship, a tangible sign of appeasement between the two blocs after the Trump years.

European and American officials confirmed on Tuesday (June 15) that an agreement has been reached between the EU and the United States to resolve their dispute over illegal subsidies granted to aircraft manufacturers Airbus and Boeing.

“The meeting started with a breakthrough on planes. We jointly decided to resolve this dispute. Today, we kept our promise,” said European Commission President Ursula von der Leyen, after Joe Biden’s arrival in Brussels for an EU/US Summit.

“This agreement opens a new chapter in our relationship because we are moving from litigation to cooperation on aeronautics, after 17 years of dispute,” she said. The two parties have agreed to suspend for five years the punitive tariffs motivated by this dispute, explained US Trade Representative Katherine Tai.

The decision of the European Union and the United States creates “the conditions for fair competition” between the two aircraft manufacturers, Airbus said on Tuesday. It allows “to avoid customs tariffs which harm everyone and only add to the many challenges facing our industry,” said a spokesperson for the European manufacturer.

Under the Trump administration, Washington was authorised, in October 2019, to impose taxes on nearly 7.5 billion dollars (6.8 billion euros) of European goods and services imported each year, to the tune of 25 % for wines and spirits, and 15% for Airbus aircraft.

The WTO had allowed Brussels to put in place retaliatory taxes on products imported from the United States. The EU has since imposed tariffs on 4 billion dollars (3.6 billion euros) in US exports.